This Medicare Hack Could Save You Thousands of Dollars a Year

My dad called me earlier this year to explain a new law in Kentucky that ended up saving him a ton of money — over $3,000 this year alone. Kentucky is the latest state to pass a Medicare “birthday rule” law (also called a “birthday law”), and while they’re not simple, these rules can make a big difference in your health care costs.

Medicare covers health care costs such as hospital stays, doctor visits, and surgeries, but once you reach your deductible, you will have to pay out of pocket for additional coverage. Supplemental Medicare Insurance, or Medigapcan help cover those co-pays. These private insurance plans help Medicare beneficiaries pay for health care not covered by original Medicare.

Medicare participants can purchase Medigap insurance for a period of six months after enrolling in Medicare Part B. After that enrollment period, most states do not offer the ability to change your Medigap coverage without medical underwriting. However, nine states now offer a free window each year to shop around for lower-cost plans.

This “birthday rule” for Medigap plans can help participants in certain states save a lot of money by purchasing cheaper plans. Find out how the Medigap birthday rule works and whether your state participates.

What is Medigap?

Medigap, also known as Medicare Supplemental Insurance, is a private health insurance plan that helps pay for gaps in Medicare coverage. It can cover costs such as deductibles, co-insurance, and co-pays.

Medigap plans are largely regulated by states. That means each state has its own rules about what plans are available and when you can buy them. There are 10 Types of Medigap Plans offered by most states — A, B, C, D, F, G, K, L, M, and N.

To purchase Medigap insurance, you must be enrolled in both Medicare Part A and Part B. You cannot be enrolled in a Medicare Advantage plan.

What is the ‘birthday rule’ for Medigap?

Medigap insurance plans are generally available for six months after you enroll in Medicare Part B. After your initial Medigap enrollment, you typically cannot change your supplemental insurance plan without medical underwriting — a process in which insurance companies use physical exams and previous medical records to determine your risk as a client.

The Medigap birthday rule allows participants to change their Medicare Supplemental Insurance coverage once a year at their own discretion, without a waiting period, physical exam, or risk of rejection due to pre-existing medical conditions. That privilege is sometimes called a “guaranteed issue” right.

This period during which you can change your Medigap plan is around your birthday. However, the length of this period and the rules for changing coverage vary by state.

Medicare enrollees who use birthday rules are generally limited to new Medigap plans that offer the same or lesser value than their current coverage. For example, if you have Medigap Plan G, you can only switch to another insurer that offers Plan G or another plan with fewer benefits.

Which states use the “birthday rule” for private Medicare insurance?

Beginning in August 2024, nine states will allow Medigap participants to change their coverage during a period around their birthday. Since there are no federal laws governing the Medigap birthday rule, the rules are set by each state.

California and Oregon were the first states to adopt the birthday rule for Medicare Supplemental Insurance, and seven others — Idaho, Illinois, Kentucky, Louisiana, Maryland, Nevada and Oklahoma — have since followed suit. Four states — Iowa, South Dakota, Vermont and Wisconsin — considered birthday rule legislation in 2024 but have not yet passed any laws.

Below are the rules for each state that has a Medigap birthday rule:

California: Medigap policyholders can change their Medigap coverage to a lower or equivalent plan each year within 60 days after their birthday.

Idaho: Medigap policyholders have 63 days after their birthday to switch Medigap plans.

Illinois: Medigap policyholders ages 65 to 75 have 45 days after their birthday each year to purchase another Medigap plan from the same insurer as their current plan.

Kentucky: Medigap enrollees have 60 days after their birthday to switch insurers for their Medigap plans. Enrollees may only exchange identical plans (e.g., G for G).

Louisiana: Medigap policyholders can change their Medigap coverage to another plan from the same insurer as their current plan, from 30 days before their birthday until 63 days after.

Maryland: Medigap policyholders may change their Medigap plan to a plan of equal or lesser value from their birthday up to 30 days later.

Nevada: Medigap policyholders may change their Medigap plan to a plan of equal or lesser value from their birthday up to 60 days later.

Oklahoma: Medigap policyholders have 60 days from their birthday to change their Medigap plan to a plan of equal or lesser value.

Oregon: Medigap policyholders have from 30 days before their birthday until 30 days after their birthday to change their Medigap plan to a plan of equal or lesser value.

To learn more about Medicare, read how premiums are expected to change in 2025 and whether you should enroll in Medicare when you turn 65.